Each month, BMO Capital Markets analyzes the promotional strategies of the largest players in the powersports industry, including those covered by BMO (Polaris, Arctic Cat, BRP and Harley-Davidson). In addition, BMO provides observations from competitors that it doesn't cover, such as Honda, Yamaha, Suzuki and Kawasaki.
In a research note provided to Powersports Business, here’s how BMO Capital Markets analyst Gerrick Johnson sums up the promotions in January:
“In January, current year model promotions were largely unchanged year over year but offers on prior year models remained significant. Similar to November and December, promotions were most heavily concentrated on prior year ORV models as OEMs seek to move old inventory ahead of the 2017 selling season.
“As we approach the midpoint of the snowmobile season, incentives and offers have been significantly reduced when compared to last year. Fueled by what has been a good snowfall start to the season we think demand has been strong following two lackluster seasons. While promotions on prior year models remain, current year models have seen almost no promotional activity in January. Last year, current year models were significantly discounted.
“In keeping with previous months, Artic Cat and Polaris remain the most promotional OEMs. Consistent with the last two months, Arctic Cat and Polaris offered the largest customer incentives. Given that Polaris dealers faced a buildup of inventory during the ‘do not ride/do not sell’ recalls in 2016, while Arctic Cat has been struggling to right size inventory levels for the past two years, we don't see this as surprising.
“BRP and Suzuki were the least two promotional manufacturers. BRP has consistently been one of the least promotional OEMs over the last six months and had no offers/incentives on any current year models in January. While Suzuki's promotions were minimal, and basically unchanged year over year.
“Motorcycle promotions declined significantly on a sequential basis. On a year-over-year basis, offers were effectively unchanged outside of Kawasaki's incentives on prior years models. On a sequential basis, OEM's were less promotional across the board. Harley-Davidson continues to work through its prior year Touring model inventory with financing offers as well as price reductions at the dealer level.”